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Information for 17580IIED

Sustainable hydropower and carbon finance

The Clean Development Mechanism (CDM) has helped finance more than 2000 hydropower projects, representing the largest source of OECD bilateral funding for hydropower. Europe, through its European Union Emissions Trading Scheme, has been the major supporter. However, environment and sustainability regulations intending to ensure ‘respect’ for the World Commission on Dams’ guidelines are falling short, prompting calls to use the industry-derived Hydropower Sustainability Assessment Protocol (HSAP).

This Issue paper explores CDM project data and finds that, under a healthy carbon price, the cost of the HSAP would not be a barrier to accessing carbon finance, and could even strengthen the carbon market.

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Project information

We can only survive without drinking water for a few days – it's crucial for our survival. Water is also crucial for supporting people's ways of life, from raising livestock, to managing fisheries and irrigating crops. In many parts of semi-arid West Africa water is in short supply and the pressures on existing water resources are set to increase. IIED aims to help bring about fairer and more sustainable water governance that ensures poor and vulnerable communities don't miss out.